A grand jury has indicted an elected official for fraud, tax evasion and conspiracy for allegedly using the power of their office for personal, political and financial gain.
No, not that guy.
On Wednesday, federal prosecutors unsealed an 11-count federal indictment alleging that former Baltimore Mayor Catherine Pugh illegally funded her campaign and her bank account by concocting a scheme that involved Baltimore charities, local businesses and Pugh’s Healthy Holly children’s books series.
The Baltimore Sun reports:
Though her customers ordered more than 100,000 copies of the books, the indictment says Pugh failed to print thousands of copies, double-sold others and took some to use for self-promotion. Pugh, 69, used the profits to buy a house, pay down debt, and make illegal straw donations to her campaign, prosecutors allege.
At the same time, prosecutors said, she was evading taxes. In 2016, for instance, when she was a state senator and ran for mayor, she told the Internal Revenue Service she had made just $31,000. In fact, her income was more than $322,000 that year ― meaning she shorted the federal government of about $100,000 in taxes, according to the U.S. attorney’s office.
The charges Pugh faces carry potential sentences totaling 175 years in prison. Prosecutors are seeking to seize $769,688 of her profits, along with her current home in Ashburton, which they allege she bought and renovated with fraudulently obtained funds.
While Pugh was mayor, she reportedly sold $500,000 in books to Baltimore’s medical system in a no-bid deal. The books were supposed to be distributed to the city’s schoolchildren, even though teachers didn’t use or even request for the books. While the books sat in a warehouse, Pugh would reportedly take a few of the already sold books to hand out as promotional material. She would later admit that she hadn’t delivered all the books that had been paid for but you probably don’t understand how hard it is to be honest when you’re defrauding taxpayers.
Even though the books were rife with grammatical errors, including a misspelling of the word “vegetable,” they sold like hotcakes, which the book’s protagonist, Holly would never eat.
After Pugh voted for Kaiser Permanente to receive a $48 million contract with the city, the health insurer bought tens of thousands of books from Pugh. Associated Black Charities, which manages $13 million in grants for the city, also brought orders in bulk. Another businessman cut Pugh’s charity a check for $100,000 and only received a sample book. Altogether, the three entities spent $300,000 on books that no one wanted to read.
And even though Maryland law allows politicians to contribute an unlimited amount to their own campaigns, Pugh funneled the Healthy Holly money to her campaign through a system of fake straw donors, which is illegal. Pugh reportedly said she used this backdoor method because she didn’t want voters to think she was “desperate” for funding. Instead, Catherine Pugh allegedly cashed $61,000 in checks at the teller window, then donated the cash to Catherine Pugh’s campaign. Sadly, Catherine Pugh never sent Catherine Pugh a thank-you note.
With all this fraud, I’m beginning to suspect that Holly wasn’t even healthy.
Pugh was elected mayor of Baltimore in 2016, the first woman, and best-selling, bulk order children’s book author to hold such a position since Dr. Seuss was elected mayor of Whoville in the late ‘80s.
Pugh reportedly recruited an aide and a director of a non-profit organization to assist in the scam. According to the indictment, the two have agreed to plead guilty to fraud and tax evasion in exchange for lighter sentences. Pugh’s charges include:
- One count of conspiracy to commit wire fraud
- Seven counts of wire fraud
- One count of conspiracy to defraud the United States
- Two counts of tax evasion.
When asked for comment, Healthy Holly lit a menthol Pall Mall, sipped a Mountain Dew Code Red and said she had to go pick up an order from Popeyes.
See...I knew it!
DISCUSSION
When given the opportunity to call the kettle black, the pot declined.